The agreement is seen as a significant breakthrough for the new government in Budapest. The billions in EU subsidies had been blocked for years due to the anti-European policies of former Prime Minister Viktor Orban, who was voted out. With Magyar's arrival, a new phase in the relationship between both parties seems to be beginning.
According to the arrangements, Hungary can claim a total of 16.4 billion euros. The majority comes from the European Recovery Fund, set up to support EU countries after the coronavirus crisis. In addition, there are cohesion funds and other European subsidies.
Reforms First
The release of the money is not automatic. The European Commission emphasizes that Hungary must first carry out a series of reforms and investments. Only when the agreed conditions are met can the funds actually be disbursed. The new Hungarian prime minister is less anti-EU than his predecessor but is also considered conservative and nationalist.
Promotion
After his talks in Brussels, Magyar called it a historic breakthrough. According to him, his government has taken important steps in a short time to regain the trust of European institutions. He stated that the European subsidies are needed to strengthen the Hungarian economy and improve public services.
Investments
Von der Leyen also expressed a positive view of the developments. She pointed out that the new government has implemented reforms within a few weeks that Brussels had long awaited. According to her, this laid the foundation for further cooperation between Brussels and Budapest.
The agreement comes at a time when the Hungarian economy is under pressure. Growth has been limited in recent years, while public finances have come under strain. The anticipated European support could therefore provide an important boost to investments and economic recovery.
Ukraine
However, not all obstacles have been removed. The European Commission makes clear that further progress is still needed before the full amount can be released. For example, Hungary must end its import blockade on Ukrainian agricultural products. The coming months will therefore be focused on elaborating and implementing the agreed measures.
For Magyar, the agreement represents a first important test of his promise to improve relations with Brussels. If the reforms proceed as planned, Hungary can access billions of euros in European support that had been out of reach for years.